Protection of a foreign investor is usually based on the national Law of the State — participant of the investment dispute. This is envisaged by Article 42 of the Washington Convention on Settlement of Investment Disputes between States and Nationals of Other States of 1965. The same article allows applying in certain cases the principles and the rules of international law to settle the conflict. It is an ordinary ICSID practice to judge on the jurisdiction of the ICSID arbitration basing on the rule of bilateral investment agreements between the governments of States, which are the international agreements fixing mutually favourable investment regime between the States — Parties to the Agreement. The incorrect interpretation of the Articles of the Agreement leads to expansion of the sphere of jurisdiction of ICSID arbitration and the infringement of the basic principle of international law on respect of sovereignty of a State. Such interpretation also makes it difficult to apply the European Law as an applicable law in the settlement of investment disputes against the States – members of the European Union.